##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

|     |  |                                                                                                                                      
|---- |  | -------------------------------------------------------------------------------------------------------------------------------------
|[X]  |  | Quarterly Report Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934 for the quarterly period ended
June 30, 2002
|     |  |                                                                                                                                      
|[  ] |  | Transition report under Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from
 to                

Commission file number: 000-30805

WGNB CORP.

(Exact name of registrant as specified in its charter)


|                                 |  |                                                
|-------------------------------- |  | -----------------------------------------------
|Georgia
(State of Incorporation) |  | 58-1640130
(I.R.S. Employer Identification No.)

201 Maple Street
P.O. Box 280
Carrollton, Georgia 30112

---

(Address of principal executive offices)


(770) 832-3557

---

(Registrantss telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes [X]    No [  ]

Indicate the number of shares outstanding of each of the issuers classes of
common stock, as of the latest practicable date:

|                              |  |                             
|----------------------------- |  | ----------------------------
|Class                         |  | Outstanding at July 29, 2002
|                              |  |                             
|Common Stock, $1.25 par value |  | 3,306,733                   





---

TABLE OF CONTENTS



|                                              |                                                                                               |                                                 |  |  |  |  |  | 
|--------------------------------------------- | --------------------------------------------------------------------------------------------- | ----------------------------------------------- |  |  |  |  |  | 
|Part I  Financial Information               
|                                              | Item 1. Financial Statements                                                                 
|                                              |                                                                                               | Consolidated Balance Sheet                     
|                                              |                                                                                               | Consolidated Statements of Earnings            
|                                              |                                                                                               | Consolidated Statements of Comprehensive Income
|                                              |                                                                                               | Consolidated Statements of Earnings            
|                                              |                                                                                               | Consolidated Statements of Comprehensive Income
|                                              |                                                                                               | Consolidated Statements of Cash Flows          
|                                              |                                                                                               | Notes to Consolidated Financial Statements     
|                                              | Item 2. Managements Discussion and Analysis of Results of Operations and Financial Condition
|                                              | Item 3. Quantitative and Qualitative Disclosures About Market Risk                           
|Part II  Other Information                  
|                                              | Item 1. Legal Proceedings                                                                    
|                                              | Item 2. Changes in Securities and Use of Proceeds                                            
|                                              | Item 3. Defaults Upon Senior Securities                                                      
|                                              | Item 4. Submission of Matters to a Vote of Security Holders                                  
|                                              | Item 5. Other Information                                                                    
|                                              | Item 6. Exhibits and Reports on Form 8-K                                                     
|SIGNATURES                                   
|Amendment to Employment Agreement            
|Amendment to Bonus and Stock Option Agreement
|Incentive Stock Option Agreement             
|Amendment to Employment Agreement            
|Incentive Stock Option Agreement             
|Amendment to Employment Agreement            
|Second Amendment to Bonus and Stock Option   
|Incentive Stock Option Agreement             
|Amendment to Employment Agreement            
|Amendment to Bonus and Stock Option Agreement
|Incentive Stock Option Agreement             
|Amendment to Employment Agreement            
|Amendment to Bonus and Stock Option Agreement
|Incentive Stock Option Agreement             
|Section 906 Certification of the CEO         
|Section 906 Certification of the CFO         



---



##### Table of Contents



WGNB CORP.

INDEX TO FORM 10-Q

|             |  |                                                                                                         |  |     
|------------ |  | ------------------------------------------------------------------------------------------------------- |  | ----
|Item Number  |  |                                                                                                        
|in Form 10-Q |  | Description                                                                                             |  | Page
|             |  |                                                                                                         |  |     
|Part One     |  | Financial Information                                                                                   |  |     
|             |  |                                                                                                         |  |     
|Item 1.      |  | Financial Statements                                                                                    |  | 1   
|             |  |                                                                                                         |  |     
|             |  | Consolidated Balance Sheets at June 30, 2002 and December 31,
2001.                                     |  | 2   
|             |  |                                                                                                         |  |     
|             |  | Consolidated Statements of Earnings for Three Months Ended June
30, 2002 and June 30, 2001.             |  | 3   
|             |  |                                                                                                         |  |     
|             |  | Consolidated Statements of Comprehensive Income for Three
Months Ended June 30, 2002 and June 30, 2001. |  | 4   
|             |  | Consolidated Statements of Earnings for Six Months Ended June
30, 2002 and June 30, 2001.               |  | 5   
|             |  |                                                                                                         |  |     
|             |  | Consolidated Statements of Comprehensive Income for Six Months
Ended June 30, 2002 and June 30, 2001.   |  | 6   
|             |  |                                                                                                         |  |     
|             |  | Consolidated Statements of Cash Flows for Six Months Ended
June 30, 2002 and June 30, 2001.             |  | 7   
|             |  |                                                                                                         |  |     
|             |  | Notes to Consolidated Financial Statements                                                              |  | 9   
|             |  |                                                                                                         |  |     
|Item 2.      |  | Managements Discussion and Analysis of Financial Condition and
Results of Operations                   |  | 11  
|             |  |                                                                                                         |  |     
|Item 3.      |  | Quantitative and Qualitative Disclosures About Market Risk                                              |  | 14  
|             |  |                                                                                                         |  |     
|Part Two     |  | Other Information                                                                                       |  |     
|             |  |                                                                                                         |  |     
|Item 1.      |  | Legal Proceedings                                                                                       |  | 15  
|             |  |                                                                                                         |  |     
|Item 2.      |  | Changes in Securities and Use of Proceeds                                                               |  | 15  
|             |  |                                                                                                         |  |     
|Item 3.      |  | Defaults Upon Senior Securities                                                                         |  | 15  
|             |  |                                                                                                         |  |     
|Item 4.      |  | Submission of Matters to a Vote of Security Holders                                                     |  | 15  
|             |  |                                                                                                         |  |     
|Item 5.      |  | Other Information                                                                                       |  | 15  
|             |  |                                                                                                         |  |     
|Item 6.      |  | Exhibits and Reports on Form 8-K                                                                        |  | 15  
|             |  |                                                                                                         |  |     
|             |  | Signatures                                                                                              |  | 17  





---



##### Table of Contents






Part I  Financial Information




Item 1. Financial Statements

The unaudited financial statements of WGNB Corp. (the Company) are set
forth on the following pages. All adjustments have been made which, in the
opinion of management, are necessary in order to make the financial statements
not misleading.

1



---



##### Table of Contents






WGNB CORP.

Consolidated Balance Sheet

June 30, 2002
(unaudited)

|                                                                    |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  |  |  |  |  | 
|------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------ | -------------------------- | -------------------------- | ------------------------- | --------- | -------------------- | ----------- | ----------------- | ------- | ----------- | ---------- |  |  |  |  |  |  |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           | For the Period Ended |             |                   |         |             |            |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           | June 30, 2002        |             | December 31, 2001 |         |             |            |  |  |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  | 
|Assets                                                             
|Cash and due from banks, including reserve requirements
of $100,000 |                                                                                                                    | $                          | 14,593,755                 |                           |           |                      | 11,314,895  |                   |         |             |            |  |  |  |  | 
|Federal funds sold                                                  |                                                                                                                    |                            | 9,570,000                  |                           |           |                      | 19,684,000  |                   |         |             |            |  |  |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  | 
|                                                                    |                                                                                                                    |                            |                            | Cash and cash equivalents |           |                      | 24,163,755  |                   |         |             | 30,998,895 |  |  |  |  |  |  |  |  | 
|Securities available for sale                                       |                                                                                                                    |                            | 55,725,674                 |                           |           |                      | 54,934,146  |                   |         |             |            |  |  |  |  | 
|Securities held to maturity                                         |                                                                                                                    |                            | 3,000,000                  |                           |           |                      | 2,000,000   |                   |         |             |            |  |  |  |  | 
|Loans, net                                                          |                                                                                                                    |                            | 252,191,715                |                           |           |                      | 249,560,369 |                   |         |             |            |  |  |  |  | 
|Premises and equipment, net                                         |                                                                                                                    |                            | 6,203,210                  |                           |           |                      | 6,306,346   |                   |         |             |            |  |  |  |  | 
|Accrued interest receivable                                         |                                                                                                                    |                            | 2,048,384                  |                           |           |                      | 1,936,980   |                   |         |             |            |  |  |  |  | 
|Other assets                                                        |                                                                                                                    |                            | 4,144,827                  |                           |           |                      | 4,485,301   |                   |         |             |            |  |  |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  | 
|                                                                    |                                                                                                                    | $                          | 347,477,565                |                           |           |                      | 350,222,037 |                   |         |             |            |  |  |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  | 
|Liabilities and Stockholders Equity                               
|Deposits:                                                           |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  | 
|                                                                    | Demand                                                                                                             |                            | $                          | 35,426,476                |           |                      |             | 32,972,953        |         |             |            |  |  |  |  |  | 
|                                                                    | Interest bearing demand                                                                                            |                            |                            | 111,303,422               |           |                      |             | 109,464,714       |         |             |            |  |  |  |  |  | 
|                                                                    | Savings                                                                                                            |                            |                            | 9,091,467                 |           |                      |             | 8,235,588         |         |             |            |  |  |  |  |  | 
|                                                                    | Time                                                                                                               |                            |                            | 80,026,353                |           |                      |             | 88,363,915        |         |             |            |  |  |  |  |  | 
|                                                                    | Time, over $100,000                                                                                                |                            |                            | 35,570,595                |           |                      |             | 41,493,958        |         |             |            |  |  |  |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  | 
|                                                                    |                                                                                                                    |                            | Total deposits             |                           |           | 271,418,313          |             |                   |         | 280,531,128 |            |  |  |  |  |  |  |  | 
|Federal Home Loan Bank advances                                     |                                                                                                                    |                            | 35,000,000                 |                           |           |                      | 35,000,000  |                   |         |             |            |  |  |  |  | 
|Other borrowings                                                    |                                                                                                                    |                            | 932,000                    |                           |           |                      | 1,282,000   |                   |         |             |            |  |  |  |  | 
|Accrued interest payable                                            |                                                                                                                    |                            | 1,387,967                  |                           |           |                      | 1,895,387   |                   |         |             |            |  |  |  |  | 
|Other liabilities                                                   |                                                                                                                    |                            | 2,519,075                  |                           |           |                      | 2,309,195   |                   |         |             |            |  |  |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  | 
|                                                                    |                                                                                                                    |                            | Total liabilities          |                           |           | 311,257,355          |             |                   |         | 321,017,710 |            |  |  |  |  |  |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  | 
|Stockholders equity:                                               |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  | 
|                                                                    | Common stock, $1.25 par value, 10,000,000 shares authorized;
3,306,733 and 3,105,355 shares issued and outstanding |                            |                            | 4,133,416                 |           |                      |             | 3,875,444         |         |             |            |  |  |  |  |  | 
|                                                                    |                                                                                                                    | Additional paid-in capital |                            |                           | 5,366,373 |                      |             |                   | 829,324 |             |            |  |  |  |  |  |  | 
|                                                                    | Retained earnings                                                                                                  |                            |                            | 25,709,334                |           |                      |             | 24,111,323        |         |             |            |  |  |  |  |  | 
|                                                                    | Accumulated comprehensive income                                                                                   |                            |                            | 1,011,087                 |           |                      |             | 388,236           |         |             |            |  |  |  |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  | 
|                                                                    |                                                                                                                    |                            | Total stockholders equity |                           |           | 36,220,210           |             |                   |         | 29,204,327  |            |  |  |  |  |  |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  | 
|                                                                    |                                                                                                                    | $                          | 347,477,565                |                           |           |                      | 350,222,037 |                   |         |             |            |  |  |  |  | 
|                                                                    |                                                                                                                    |                            |                            |                           |           |                      |             |                   |         |             |            |  |  |  |  | 

See accompanying notes to consolidated financial statements.

2



---



##### Table of Contents






WGNB CORP.Consolidated Statements of Earnings

For the Three Months Ended June 30, 2002 and 2001
(unaudited)

|                          |                                       |                             |                                                     |                      |           |                            |           |               |           |           |           | 
|------------------------- | ------------------------------------- | --------------------------- | --------------------------------------------------- | -------------------- | --------- | -------------------------- | --------- | ------------- | --------- | --------- | --------- | 
|                          |                                       |                             |                                                     |                      |           | For the Three Months Ended
|                          |                                       |                             |                                                     |                      |           |                           
|                          |                                       |                             |                                                     |                      |           | June 30, 2002              |           | June 30, 2001
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|Interest income:          |                                       |                             |                                                     |                      |           |                            |           |              
|                          | Interest and fees on loans            |                             | $                                                   | 5,136,541            |           |                            |           | 6,027,733     |          
|                          | Interest on federal funds sold        |                             |                                                     | 55,646               |           |                            |           | 97,551        |          
|                          | Interest on investment securities:    |                             |                                                     |                      |           |                            |           |               |          
|                          |                                       | U.S. Government agencies    |                                                     |                      | 426,915   |                            |           |               | 446,162   |          
|                          |                                       | State, county and municipal |                                                     |                      | 298,824   |                            |           |               | 202,705   |          
|                          |                                       | Other                       |                                                     |                      | 106,581   |                            |           |               | 57,997    |          
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|                          |                                       |                             | Total interest income                               |                      |           | 6,024,507                  |           |               |           | 6,832,148 |          
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|Interest expense:         |                                       |                             |                                                     |                      |           |                            |           |              
|                          | Interest on deposits:                 |                             |                                                     |                      |           |                            |           |               |          
|                          |                                       | Demand                      |                                                     |                      | 380,601   |                            |           |               | 740,234   |          
|                          |                                       | Savings                     |                                                     |                      | 24,238    |                            |           |               | 61,587    |          
|                          |                                       | Time                        |                                                     |                      | 1,273,004 |                            |           |               | 1,841,993 |          
|                          | Interest on FHLB and other borrowings |                             |                                                     | 454,978              |           |                            |           | 468,092       |          
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|                          |                                       |                             | Total interest expense                              |                      |           | 2,132,821                  |           |               |           | 3,111,906 |          
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|                          |                                       |                             | Net interest income                                 |                      |           | 3,891,686                  |           |               |           | 3,720,242 |          
|Provision for loan losses |                                       |                             | 75,000                                              |                      |           |                            | 228,000   |              
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|                          |                                       |                             | Net interest income after
provision for loan losses |                      |           | 3,816,686                  |           |               |           | 3,492,242 |          
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|Other income:             |                                       |                             |                                                     |                      |           |                            |           |              
|                          | Service charges on deposit accounts   |                             |                                                     | 780,746              |           |                            |           | 733,316       |          
|                          | Miscellaneous                         |                             |                                                     | 416,866              |           |                            |           | 350,589       |          
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|                          |                                       |                             |                                                     | Total other income   |           |                            | 1,197,612 |               |           |           | 1,083,905 | 
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|Other expenses:           |                                       |                             |                                                     |                      |           |                            |           |              
|                          | Salaries and employee benefits        |                             |                                                     | 1,767,389            |           |                            |           | 1,576,687     |          
|                          | Occupancy                             |                             |                                                     | 415,521              |           |                            |           | 367,426       |          
|                          | Other operating                       |                             |                                                     | 839,419              |           |                            |           | 704,661       |          
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|                          |                                       |                             |                                                     | Total other expenses |           |                            | 3,022,329 |               |           |           | 2,648,774 | 
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|                          |                                       |                             | Earnings before income taxes                        |                      |           | 1,991,969                  |           |               |           | 1,927,373 |          
|Income taxes              |                                       |                             | 676,581                                             |                      |           |                            | 673,401   |              
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|                          |                                       |                             | Net earnings                                        |                      | $         | 1,315,388                  |           |               |           | 1,253,972 |          
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|                          |                                       |                             | Basic earnings per share                            |                      | $         | .40                        |           |               | $         | .40       |          
|                          |                                       |                             |                                                     |                      |           |                            |           |              
|                          |                                       |                             | Diluted net earnings per share                      |                      | $         | .40                        |           |               | $         | .40       |          
|                          |                                       |                             |                                                     |                      |           |                            |           |              

See accompanying notes to consolidated financial statements.

3



---



##### Table of Contents






WGNB CORP.

Consolidated Statements of Comprehensive Income

For the Three Months Ended June 30, 2002 and 2001
(unaudited)

|                                               |                                                                        |                                                     |           |                            |           |               |           |   |          |  
|---------------------------------------------- | ---------------------------------------------------------------------- | --------------------------------------------------- | --------- | -------------------------- | --------- | ------------- | --------- | - | -------- | -
|                                               |                                                                        |                                                     |           | For the Three Months Ended
|                                               |                                                                        |                                                     |           |                           
|                                               |                                                                        |                                                     |           | June 30, 2002              |           | June 30, 2001
|                                               |                                                                        |                                                     |           |                            |           |              
|Net earnings                                   |                                                                        | $                                                   | 1,315,388 |                            |           |               | 1,253,972 |  
|Other comprehensive income (loss), net of tax: |                                                                        |                                                     |           |                            |           |               |           |  
|                                               | Unrealized gains (losses) on investment
securities available for sale: |                                                     |           |                            |           |               |           |   |         
|                                               |                                                                        | Unrealized gains (losses) arising during the period |           |                            | 1,106,604 |               |           |   | (164,756 | )
|                                               |                                                                        | Associated benefit (taxes)                          |           |                            | (365,179  | )             |           |   | 57,665   |  
|                                               |                                                                        | Reclassification adjustment for gains               |           |                            | (35,370   | )             |           |   |         |  
|                                               |                                                                        | Associated taxes                                    |           |                            | 11,672    |               |           |   |         |  
|                                               |                                                                        |                                                     |           |                            |           |               |           |  
|Other comprehensive income (loss)              |                                                                        |                                                     | 717,727   |                            |           |               | (107,091  | )
|                                               |                                                                        |                                                     |           |                            |           |               |           |  
|Comprehensive income                           |                                                                        | $                                                   | 2,033,115 |                            |           |               | 1,146,881 |  
|                                               |                                                                        |                                                     |           |                            |           |               |           |  

See accompanying notes to consolidated financial statements.

4



---



##### Table of Contents






WGNB CORP.Consolidated Statements of Earnings

For the Six Months Ended June 30, 2002 and 2001
(unaudited)

|                          |                                       |                             |           |                                                     |         |                          |            |               |         |           |            | 
|------------------------- | ------------------------------------- | --------------------------- | --------- | --------------------------------------------------- | ------- | ------------------------ | ---------- | ------------- | ------- | --------- | ---------- | 
|                          |                                       |                             |           |                                                     |         | For the Six Months Ended
|                          |                                       |                             |           |                                                     |         |                         
|                          |                                       |                             |           |                                                     |         | June 30, 2002            |            | June 30, 2001
|                          |                                       |                             |           |                                                     |         |                          |            |              
|Interest income:          |                                       |                             |           |                                                     |         |                          |            |              
|                          | Interest and fees on loans            |                             | $         | 10,311,342                                          |         |                          |            | 11,786,656    |        
|                          | Interest on federal funds sold        |                             |           | 144,940                                             |         |                          |            | 208,813       |        
|                          | Interest on investment securities:    |                             |           |                                                     |         |                          |            |               |        
|                          |                                       | U.S. Government agencies    |           |                                                     | 856,067 |                          |            |               | 890,882 |          
|                          |                                       | State, county and municipal |           |                                                     | 599,711 |                          |            |               | 376,544 |          
|                          |                                       | Other                       |           |                                                     | 208,377 |                          |            |               | 114,284 |          
|                          |                                       |                             |           |                                                     |         |                          |            |              
|                          |                                       |                             |           | Total interest income                               |         |                          | 12,120,437 |               |         |           | 13,377,179 | 
|                          |                                       |                             |           |                                                     |         |                          |            |              
|Interest expense:         |                                       |                             |           |                                                     |         |                          |            |              
|                          | Interest on deposits:                 |                             |           |                                                     |         |                          |            |               |        
|                          |                                       |                             | Demand    |                                                     |         | 771,313                  |            |               |         | 1,525,115 |           
|                          |                                       |                             | Savings   |                                                     |         | 47,621                   |            |               |         | 118,831   |           
|                          |                                       |                             | Time      |                                                     |         | 2,779,740                |            |               |         | 3,582,192 |           
|                          | Interest on FHLB and other borrowings |                             |           | 913,727                                             |         |                          |            | 882,234       |        
|                          |                                       |                             |           |                                                     |         |                          |            |              
|                          |                                       |                             |           | Total interest expense                              |         |                          | 4,512,401  |               |         |           | 6,108,372  | 
|                          |                                       |                             |           |                                                     |         |                          |            |              
|                          |                                       |                             |           | Net interest income                                 |         |                          | 7,608,036  |               |         |           | 7,268,807  | 
|Provision for loan losses |                                       |                             | 150,000   |                                                     |         |                          | 454,500    |              
|                          |                                       |                             |           |                                                     |         |                          |            |              
|                          |                                       |                             |           | Net interest income after
provision for loan losses |         |                          | 7,458,036  |               |         |           | 6,814,307  | 
|                          |                                       |                             |           |                                                     |         |                          |            |              
|Other income:             |                                       |                             |           |                                                     |         |                          |            |              
|                          | Service charges on deposit accounts   |                             |           | 1,505,737                                           |         |                          |            | 1,399,866     |        
|                          | Miscellaneous                         |                             |           | 847,743                                             |         |                          |            | 727,817       |        
|                          |                                       |                             |           |                                                     |         |                          |            |              
|                          |                                       |                             |           | Total other income                                  |         |                          | 2,353,480  |               |         |           | 2,127,683  | 
|                          |                                       |                             |           |                                                     |         |                          |            |              
|Other expenses:           |                                       |                             |           |                                                     |         |                          |            |              
|                          | Salaries and employee benefits        |                             |           | 3,544,316                                           |         |                          |            | 3,051,541     |        
|                          | Occupancy                             |                             |           | 836,039                                             |         |                          |            | 745,251       |        
|                          | Other operating                       |                             |           | 1,600,617                                           |         |                          |            | 1,393,565     |        
|                          |                                       |                             |           |                                                     |         |                          |            |              
|                          |                                       |                             |           | Total other expenses                                |         |                          | 5,980,972  |               |         |           | 5,190,357  | 
|                          |                                       |                             |           |                                                     |         |                          |            |              
|                          |                                       |                             |           | Earnings before income taxes                        |         |                          | 3,830,544  |               |         |           | 3,751,633  | 
|Income taxes              |                                       |                             | 1,294,312 |                                                     |         |                          | 1,308,204  |              
|                          |                                       |                             |           |                                                     |         |                          |            |              
|                          |                                       |                             |           | Net earnings                                        |         | $                        | 2,536,232  |               |         |           | 2,443,429  | 
|                          |                                       |                             |           |                                                     |         |                          |            |              
|                          |                                       |                             |           | Net earnings per share                              |         | $                        | .80        |               |         |           | .79        | 
|                          |                                       |                             |           |                                                     |         |                          |            |              
|                          |                                       |                             |           | Diluted net earnings per share                      |         | $                        | .79        |               |         |           | .78        | 
|                          |                                       |                             |           |                                                     |         |                          |            |              

See accompanying notes to consolidated financial statements.

5



---



##### Table of Contents



WGNB CORP.




Consolidated Statements of Comprehensive Income

For the Six Months Ended June 30, 2002 and 2001
(unaudited)

|                                        |                                                               |                                            |           |                          |          |               |           |  |          |  
|--------------------------------------- | ------------------------------------------------------------- | ------------------------------------------ | --------- | ------------------------ | -------- | ------------- | --------- |  | -------- | -
|                                        |                                                               |                                            |           | For the Six Months Ended
|                                        |                                                               |                                            |           |                         
|                                        |                                                               |                                            |           | June 30, 2002            |          | June 30, 2001
|                                        |                                                               |                                            |           |                          |          |              
|Net earnings                            |                                                               | $                                          | 2,536,232 |                          |          |               | 2,443,429 | 
|Other comprehensive income, net of tax: |                                                               |                                            |           |                          |          |               |           | 
|                                        | Unrealized gains on investment
securities available for sale: |                                            |           |                          |          |               |           |  |         
|                                        |                                                               | Unrealized gains arising during the period |           |                          | 968,333  |               |           |  | 607,943  |  
|                                        |                                                               | Associated taxes                           |           |                          | (319,550 | )             |           |  | (216,170 | )
|                                        |                                                               | Reclassification adjustment for gains      |           |                          | (38,705  | )             |           |  |         |  
|                                        |                                                               | Associated benefit                         |           |                          | 12,773   |               |           |  |         |  
|                                        |                                                               |                                            |           |                          |          |               |           | 
|Other comprehensive income              |                                                               |                                            | 622,851   |                          |          |               | 391,773   | 
|                                        |                                                               |                                            |           |                          |          |               |           | 
|Comprehensive income                    |                                                               | $                                          | 3,159,083 |                          |          |               | 2,835,202 | 
|                                        |                                                               |                                            |           |                          |          |               |           | 

See accompanying notes to consolidated financial statements.

6



---



##### Table of Contents






WGNB CORP.

Consolidated Statements of Cash Flows

For the Six Months Ended June 30, 2002 and 2001
(unaudited)

|                                                 |                                                                                     |                                               |                   |                                                  |          |                          |            |               |         |          |             |  
|------------------------------------------------ | ----------------------------------------------------------------------------------- | --------------------------------------------- | ----------------- | ------------------------------------------------ | -------- | ------------------------ | ---------- | ------------- | ------- | -------- | ----------- | -
|                                                 |                                                                                     |                                               |                   |                                                  |          | For the Six Months Ended
|                                                 |                                                                                     |                                               |                   |                                                  |          |                         
|                                                 |                                                                                     |                                               |                   |                                                  |          | June 30, 2002            |            | June 30, 2001
|                                                 |                                                                                     |                                               |                   |                                                  |          |                          |            |              
|Cash flows from operating activities:            |                                                                                     |                                               |                   |                                                  |          |                          |            |              
|                                                 | Net earnings                                                                        |                                               | $                 | 2,536,232                                        |          |                          |            | 2,443,429     |        
|                                                 | Adjustments to reconcile net earnings to net cash
provided by operating activities: |                                               |                   |                                                  |          |                          |            |               |        
|                                                 |                                                                                     | Depreciation, amortization and accretion      |                   |                                                  | 543,494  |                          |            |               | 380,378 |         
|                                                 |                                                                                     | Provision for loan losses                     |                   |                                                  | 150,000  |                          |            |               | 454,500 |         
|                                                 |                                                                                     | Provision for deferred income taxes           |                   |                                                  | (298,159 | )                        |            |               | 90,717  |         
|                                                 |                                                                                     | Gain on sale of securities available for sale |                   |                                                  | (38,705  | )                        |            |               |        |         
|                                                 |                                                                                     | Loss on sale of other real estate             |                   |                                                  | 7,244    |                          |            |               |        |         
|                                                 |                                                                                     | Change in:                                    |                   |                                                  |          |                          |            |               |         |         
|                                                 |                                                                                     |                                               | Other assets      |                                                  |          | 93,704                   |            |               |         | (438,273 | )          
|                                                 |                                                                                     |                                               | Other liabilities |                                                  |          | (352,758                 | )          |               |         | 582,915  |            
|                                                 |                                                                                     |                                               |                   |                                                  |          |                          |            |              
|                                                 |                                                                                     |                                               |                   | Net cash provided by operating activities        |          |                          | 2,641,052  |               |         |          | 3,513,666   |  
|                                                 |                                                                                     |                                               |                   |                                                  |          |                          |            |              
|Cash flows from investing activities:            |                                                                                     |                                               |                   |                                                  |          |                          |            |              
|                                                 | Proceeds from sales of securities available for sale                                |                                               |                   | 6,368,385                                        |          |                          |            |              |        
|                                                 | Proceeds from maturities of securities available for sale                           |                                               |                   | 6,305,875                                        |          |                          |            | 10,655,921    |        
|                                                 | Purchases of securities available for sale                                          |                                               |                   | (12,649,813                                      | )        |                          |            | (13,784,725   | )      
|                                                 | Purchase of securities held to maturity                                             |                                               |                   | (1,000,000                                       | )        |                          |            |              |        
|                                                 | Net change in loans                                                                 |                                               |                   | (2,781,346                                       | )        |                          |            | (28,923,472   | )      
|                                                 | Purchases of premises and equipment                                                 |                                               |                   | (275,172                                         | )        |                          |            | (543,954      | )      
|                                                 | Capital expenditures for other real estate                                          |                                               |                   | (11,843                                          | )        |                          |            | (137,881      | )      
|                                                 | Proceeds from sales of other real estate                                            |                                               |                   | 118,519                                          |          |                          |            | 292,490       |        
|                                                 |                                                                                     |                                               |                   |                                                  |          |                          |            |              
|                                                 |                                                                                     |                                               |                   | Net cash used by investing activities            |          |                          | (3,925,395 | )             |         |          | (32,441,621 | )
|                                                 |                                                                                     |                                               |                   |                                                  |          |                          |            |              
|Cash flows from financing activities:            |                                                                                     |                                               |                   |                                                  |          |                          |            |              
|                                                 | Net change in deposits                                                              |                                               |                   | (9,112,815                                       | )        |                          |            | 30,268,189    |        
|                                                 | Federal Home Loan Bank advances                                                     |                                               |                   |                                                 |          |                          |            | 10,000,000    |        
|                                                 | Net change in federal funds purchased                                               |                                               |                   |                                                 |          |                          |            | (600,000      | )      
|                                                 | Proceeds from other borrowings                                                      |                                               |                   |                                                 |          |                          |            | 132,000       |        
|                                                 | Repayment of other borrowings                                                       |                                               |                   | (350,000                                         | )        |                          |            | (135,000      | )      
|                                                 | Dividends paid                                                                      |                                               |                   | (853,636                                         | )        |                          |            | (830,005      | )      
|                                                 | Issuance of common stock, net                                                       |                                               |                   | 4,765,654                                        |          |                          |            |               |        
|                                                 | Exercise of stock options                                                           |                                               |                   |                                                 |          |                          |            | 20,743        |        
|                                                 | Retirement of common stock                                                          |                                               |                   |                                                 |          |                          |            | (15,088       | )      
|                                                 |                                                                                     |                                               |                   |                                                  |          |                          |            |              
|                                                 |                                                                                     |                                               |                   | Net cash (used) provided by financing activities |          |                          | (5,550,797 | )             |         |          | 38,840,839  |  
|                                                 |                                                                                     |                                               |                   |                                                  |          |                          |            |              
|Change in cash and cash equivalents              |                                                                                     |                                               | (6,835,140        | )                                                |          |                          | 9,912,884  |              
|Cash and cash equivalents at beginning of period |                                                                                     |                                               | 30,998,895        |                                                  |          |                          | 11,937,664 |              
|                                                 |                                                                                     |                                               |                   |                                                  |          |                          |            |              
|Cash and cash equivalents at end of period       |                                                                                     | $                                             | 24,163,755        |                                                  |          |                          | 21,850,548 |              
|                                                 |                                                                                     |                                               |                   |                                                  |          |                          |            |              

See accompanying notes to consolidated financial statements.

7



---



##### Table of Contents



WGNB CORP.

Consolidated Statements of Cash Flows, continued

For the Six Months Ended June 30, 2002 and 2001
(unaudited)

|                                                  |                                              |  |                                                                         |  |                          |           |               |  |  |           | 
|------------------------------------------------- | -------------------------------------------- |  | ----------------------------------------------------------------------- |  | ------------------------ | --------- | ------------- |  |  | --------- | 
|                                                  |                                              |  |                                                                         |  | For the Six Months Ended
|                                                  |                                              |  |                                                                         |  |                         
|                                                  |                                              |  |                                                                         |  | June 30, 2002            |           | June 30, 2001
|                                                  |                                              |  |                                                                         |  |                          |           |              
|Supplemental disclosure of cash flow information: |                                              |  |                                                                         |  |                          |           |               | 
|                                                  | Cash paid during the quarter for:            |  |                                                                         |  |                          |           |               |  | 
|                                                  |                                              |  | Interest                                                                |  | $                        | 5,019,821 |               |  |  | 6,066,936 | 
|                                                  |                                              |  | Income taxes                                                            |  |                          | 1,818,950 |               |  |  | 1,438,838 | 
|                                                  | Non-cash investing and financing activities: |  |                                                                         |  |                          |           |               |  | 
|                                                  |                                              |  | Change in unrealized gains on
securities available for sale, net of tax |  |                          | 622,851   |               |  |  | 391,773   | 
|                                                  |                                              |  | Change in dividends payable                                             |  |                          | 84,585    |               |  |  | 25,481    | 
|                                                  |                                              |  | Satisfaction of other liability with issuance
of common stock           |  |                          | 29,367    |               |  |  | 25,438    | 

See accompanying notes to consolidated financial statements.

8



---



##### Table of Contents






WGNB Corp.
Notes to Consolidated Financial Statements

June 30, 2002
(unaudited)



|(1) |  | Basis of Presentation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    |  | The consolidated financial statements include the accounts of WGNB Corp.
(the Company) and its wholly-owned subsidiaries, West Georgia National Bank
(the Bank) and West Georgia Credit Services, Inc. (the Finance Company).
All significant inter-company accounts have been eliminated in consolidation.
In some cases, certain prior period amounts have been reclassified to
conform with current year presentation.                                                                                                                                                                                                                                                                      
|   
|    |  | The accompanying unaudited interim consolidated financial statements reflect
all adjustments which, in the opinion of management, are necessary to present
fairly the Companys financial position as of June 30, 2002, and the results
of its operations and its cash flows for the six-month period then ended.
All such adjustments are normal and recurring in nature. The financial
statements included herein should be read in conjunction with consolidated
financial statements and the related notes and the report of independent
accountants included in the Companys filing on Form 10-K which included the
results of operations for the years ended December 31, 2001, 2000 and 1999.
|   
|(2) |  | Net Earnings Per Share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   
|    |  | Basic earnings per share is based on the weighted average number of common
shares outstanding during the period while the effects of potential common
shares outstanding during the period are included in diluted earnings per
share. The average market price during the year is used to compute
equivalent shares.                                                                                                                                                                                                                                                                                                                                                                                
|   
|    |  | Reconciliation of the amounts used in the computation of both basic earnings
per share and diluted earnings per share for the periods ended June 30,
2002 and June 30, 2001 are as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

|                                              |  |                                        |           |               |  |           |           |  |  |          |      |  
|--------------------------------------------- |  | -------------------------------------- | --------- | ------------- |  | --------- | --------- |  |  | -------- | ---- | -
|                                              |  | For the six months ended June 30, 2002
|                                              |  |                                       
|                                              |  |                                        |           |               |  |           |           |  |  | Earnings
|                                              |  | Net Earnings                           |           | Common Shares |  | per Share
|                                              |  |                                        |           |               |  |          
|Basic earnings per share                      |  | $                                      | 2,536,232 |               |  |           | 3,181,168 |  |  | $        | .80  |  
|Effect of dilutive securities  Stock Options |  |                                        |          |               |  |           | 28,712    |  |  |          | (.01 | )
|                                              |  |                                        |           |               |  |           |           |  |  |          |      |  
|Diluted earnings per share                    |  | $                                      | 2,536,232 |               |  |           | 3,209,880 |  |  | $        | .79  |  
|                                              |  |                                        |           |               |  |           |           |  |  |          |      |  

|                                              |  |                                        |           |               |  |           |           |  |  |          |      |  
|--------------------------------------------- |  | -------------------------------------- | --------- | ------------- |  | --------- | --------- |  |  | -------- | ---- | -
|                                              |  | For the six months ended June 30, 2001
|                                              |  |                                       
|                                              |  |                                        |           |               |  |           |           |  |  | Earnings
|                                              |  | Net Earnings                           |           | Common Shares |  | per Share
|                                              |  |                                        |           |               |  |          
|Basic earnings per share                      |  | $                                      | 2,443,429 |               |  |           | 3,096,889 |  |  | $        | .79  |  
|Effect of dilutive securities  Stock Options |  |                                        |          |               |  |           | 32,500    |  |  |          | (.01 | )
|                                              |  |                                        |           |               |  |           |           |  |  |          |      |  
|Diluted earnings per share                    |  | $                                      | 2,443,429 |               |  |           | 3,129,389 |  |  | $        | .78  |  
|                                              |  |                                        |           |               |  |           |           |  |  |          |      |  

9



---



##### Table of Contents



WGNB Corp.

Notes to Consolidated Financial Statements

June 30, 2002
(unaudited)



|(2) |  | Net Earnings Per Share, continued
|--- |  | ---------------------------------

|                                              |  |                                     |           |               |  |           |           |  |  |          |     | 
|--------------------------------------------- |  | ----------------------------------- | --------- | ------------- |  | --------- | --------- |  |  | -------- | --- | 
|                                              |  | For the quarter ended June 30, 2002
|                                              |  |                                    
|                                              |  |                                     |           |               |  |           |           |  |  | Earnings
|                                              |  | Net Earnings                        |           | Common Shares |  | per Share
|                                              |  |                                     |           |               |  |          
|Basic earnings per share                      |  | $                                   | 1,315,388 |               |  |           | 3,258,381 |  |  | $        | .40 | 
|Effect of dilutive securities  Stock Options |  |                                     |          |               |  |           | 25,970    |  |  |          |    | 
|                                              |  |                                     |           |               |  |           |           |  |  |          |     | 
|Diluted earnings per share                    |  | $                                   | 1,315,388 |               |  |           | 3,284,351 |  |  | $        | .40 | 
|                                              |  |                                     |           |               |  |           |           |  |  |          |     | 

|                                              |  |                                     |           |               |  |           |           |  |  |          |     | 
|--------------------------------------------- |  | ----------------------------------- | --------- | ------------- |  | --------- | --------- |  |  | -------- | --- | 
|                                              |  | For the quarter ended June 30, 2001
|                                              |  |                                    
|                                              |  |                                     |           |               |  |           |           |  |  | Earnings
|                                              |  | Net Earnings                        |           | Common Shares |  | per Share
|                                              |  |                                     |           |               |  |          
|Basic earnings per share                      |  | $                                   | 1,253,972 |               |  |           | 3,099,653 |  |  | $        | .40 | 
|Effect of dilutive securities  Stock Options |  |                                     |          |               |  |           | 35,924    |  |  |          |    | 
|                                              |  |                                     |           |               |  |           |           |  |  |          |     | 
|Diluted earnings per share                    |  | $                                   | 1,253,972 |               |  |           | 3,135,577 |  |  | $        | .40 | 
|                                              |  |                                     |           |               |  |           |           |  |  |          |     | 



|(3) |  | Issuance of Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    |  | On April 10, 2002, the Company commenced a public offering of 200,000 shares
of its common stock at a purchase price of $24.00 per share, or an aggregate
amount of $4,800,000. The offering was conducted through the Companys
officers and directors on a best-efforts basis without compensation. The
entire 200,000 shares subject to the registration statement were sold and the
offering was terminated on April 23, 2002. As of June 30, 2002, the Company
received net proceeds from the offering of $4,765,654, representing total
offering proceeds of $4,800,000, less offering expenses of $34,346.

10



---



##### Table of Contents






Item 2. Managements Discussion and Analysis of Results of Operations and
Financial Condition

The following analysis compares WGNB Corps results of operations for the
quarterly and six month periods ended June 30, 2002 and 2001 and reviews the
important factors affecting WGNB Corp.s financial condition at June 30, 2002
compared to December 31, 2001. These comments should be read in conjunction
with the Companys consolidated financial statements and the accompanying notes
appearing elsewhere in this report.

Forward Looking Statements

This Report may contain certain forward-looking statements including
statements concerning plans, objectives, future events or performance and
assumptions and other statements that are not statements of historical fact.
The Company cautions readers that the following important factors, among
others, could cause the Companys actual results to differ materially from the
forward-looking statements contained in this Report: (i) the effect of changes
in laws and regulations, including federal and state banking laws and
regulations, with which the Company and its subsidiaries must comply, and the
associated costs of compliance with such laws and regulations either currently
or in the future as applicable; (ii) the effect of changes in accounting
policies and practices, as may be adopted by the regulatory agencies as well as
by the Financial Accounting Standards Board, or of changes in the Companys
organization, compensation and benefit plans; (iii) the effect on the Companys
competitive position within its market area of the increasing consolidation
within the banking and financial services industries, including the increased
competition from larger regional and out-of-state banking organizations as well
as non-bank providers of various financial services; (iv) the effect of changes
in interest rates; and (v) the effect of changes in the business cycle and
downturns in local, regional or national economies. The Company cautions that
the foregoing list of important factors is not exclusive.

Results of Operations

Overview

Net earnings for the six months ended June 30, 2002 were $2.5 million,
which represented an increase of $92,800 or 3.8 percent compared to the six
months ended June 30, 2001. Net earnings per diluted common share increased
only slightly from $.78 per share to $.79 per share when comparing the same two
periods. Net earnings for the second quarter ended June 30, 2002 were $1.3
million compared to $1.2 million for the second quarter of 2001. The companys
operating results have remained consistent despite continued low interest rates
and a stalling economy. The interest margin has rebounded from 4.37 percent as
of December 31, 2001 to 4.93 percent as of June 30, 2002. The increase in the
interest margin is primarily due to a decrease of 55 basis points in cost of
funds during the same time period. However, managements analysis continues
to show that the Companys loan loss reserve has adequately provided for any
inherent risk in the loan portfolio. Mortgage origination fees attributable to
continued refinancing activity has had a positive impact on earnings. Mortgage
origination fee income increased by $139,000 or 48.5 percent when comparing the
first six months of 2002 to 2001, and increased by $38,000 or 23.6 percent when
comparing the second quarters ended June 30, 2002 and 2001.

Net Interest Income

The Companys year-to-date second quarter 2002 net interest margin
exceeded that of the same period in 2001 by $339,000 or 4.7 percent. This is
primarily attributable to growth in interest-bearing assets in excess of
interest-bearing liabilities and the cost of funds for the period declining
approximately 150 basis points. Based on average balances, interest-bearing
assets increased by approximately $38 million while interest bearing
liabilities increased approximately $31 million. The decrease in the cost of
funds is attributable to the sharp decline in market interest rates over the
last year and a change in the deposit mix. Average non-interest-bearing
deposits have increased by $2.6 million while lower yielding transaction and
savings accounts have increased by $15.5 million. Additionally, while average
time deposits increased by $8 million, these new accounts were priced at the
current lower yields offered by the Bank. Similar trends hold true when
comparing quarterly net interest income for the second quarters ended 2002 and
2001.

Because of the large increase in transaction accounts, the Bank has not
chosen to lead the market in certificate of deposit rates. This is important
because loan volume has slowed in the first six months of 2002 when compared to
the same period in 2001. As rates on loans decline, they can be matched with
lower costing transaction accounts rather than certificates of deposit. This
has the effect of stabilizing the Companys interest margin despite the lower
interest rates earned on loans.

11



---



##### Table of Contents



Non-Interest Income and Expense

Non-interest income for the first six months of 2002 has increased
$226,000 or 11 percent when compared to the first six months of 2001. Service
charges on deposit accounts has increased $106,000 or 8 percent during the
first six months of 2002 compared to the first six months of 2001. This
increase was due primarily to increased income from non-sufficient funds
charges. Miscellaneous other income includes residential mortgage loan
origination fees as well as other fees, gains and losses. The decline in
market interest rates has been beneficial to the Banks ability to generate
mortgage loan origination fees. Mortgage loan origination fees for the first
six months of 2002 have outpaced the same period in 2001 by $139,000 or 49
percent.

Non-interest income for the second quarter ended June 30, 2002 increased
$114,000 or 10 percent when compared to the second quarter ended 2001. The
increase was primarily attributable to a service charges on deposit accounts
increase of $47,000 or 6 percent and a mortgage origination fee income increase
of $38,000 or 24 percent.

Non-interest expense increased $791,000 or 15 percent in the first two
quarters of 2002 compared to the same period in 2001. Salaries and employee
benefits increased $493,000, a 16 percent increase over the first six months of
2001. This increase is primarily due to increased commissions for mortgage
originators, additional staff at the Douglasville branch, annual salary
increases, increased group insurance costs and increased profit sharing
accruals. The Bank increased its full time equivalent employee count from 131
in June of 2001 to 141 in June of 2002.

Occupancy expenses increased $91,000 or 12 percent year-to-date from 2001
to 2002. This is attributable to a full six months of occupancy in the Banks
Douglasville branch in the first half of 2002 (which was not the case in the
first half of 2001 since the Douglasville branch did not open until July 2001).
Other operating expenses increased $207,000 or 15 percent. The increase in
other operating expenses is attributable to fees associated with the bounce
protection program and legal and other professional fees related to business
development.

Comparing non-interest expense quarter to quarter, similar increases hold
true. Total non-interest expense increased $374,000 or 14 percent comparing
the second quarters ended 2002 and 2001. Salaries and benefits accounted for
$191,000 of the increase and other operating expenses, including legal and
professional expenses, accounted for $135,000 of the increase.

Income Taxes

Income tax expense for the first six months of 2002 was $1.3 million
compared to $1.3 million for the same period in 2001. The effective tax rate
for each of the periods ended June 30, 2002 was 34 percent and 2001 was 35
percent. The reduced marginal rate is due to the purchase of state tax
credits.

Provision and Allowance for Loan Losses

The adequacy of the allowance for loan losses is determined through
managements informed judgment concerning the amount of risk inherent in the
Companys loan portfolio. This judgment is based on such factors as the change
in levels of non-performing and past due loans, historical loan loss
experience, borrowers financial condition, concentration of loans to specific
borrowers and industries, estimated values of underlying collateral, and
current and prospective economic conditions. The allowance for loan losses at
June 30, 2002 was $3.7 million or 1.46 percent of total loans compared to $3.7
million or 1.47 percent of total loans at December 31, 2001. The Bank has
begun to see some impact of the slowing economy on some borrowers ability to
repay, however, management believes that the allowance for loan losses is
adequate to absorb possible loss in the loan portfolio.

Non-Performing Assets and Past Due Loans

Non-performing assets, comprised of real estate owned, non-accrual loans
and loans for which payments are more than 90 days past due, totaled $2,854,000
at June 30, 2002 compared to $1,356,000 at June 30, 2001. Non-performing assets
as a percentage of total loans and real estate owned at June 30, 2002 and June
30, 2001 were 1.1 percent and .5 percent, respectively.

The Company has a loan review function that continually monitors selected
loans for which general economic conditions or changes within a particular
industry could cause the borrowers financial difficulties. The loan review
function also identifies loans with high degrees of credit or other risks. The
focus of loan review, as well as management, is to

12



---



##### Table of Contents



maintain a low level of non-performing assets and return current
non-performing assets to earning status. Management is unaware of any known
trends, events or uncertainties that will have or that are reasonably likely to
have a material effect on liquidity, capital resources or operations.

Financial Condition

Overview

Total assets were $347 million at June 30, 2002, a decrease of $2.7
million or .8 percent from December 31, 2001.

Assets and Funding

At June 30, 2002 earning assets totaled $325 million, a decrease of $6.6
million from December 31, 2001. The mix of interest earning assets has changed
slightly since the beginning of 2002. As a percentage of interest earning
assets, loans increased to 78 percent and investment securities and federal
funds increased to 22 percent at June 30, 2002, as compared to loans of 76
percent and investments and federal funds of 24 percent at December 31, 2001.
The primary reason for the change in the mix is a decrease in federal funds of
$10 million resulting from a decrease in total deposits of more than $9
million.

At June 30, 2002, interest-bearing deposits decreased $11.6 million
compared to December 2001. Non-interest-bearing deposits increased $2.5 million
in the first six months of 2002 while certificates of deposit decreased by
$14.3 million. As previously discussed, the transition in the deposit mix is
the result of the sharp decline in deposit rates. On December 31, 2001,
transaction and savings accounts constituted 54 percent and certificates of
deposits accounted for 46 percent of total deposits. By the end of June, 2002,
transaction and savings accounts made up 57 percent and certificates of deposit
amounted to 43 percent of total deposits. At June 30, 2002, deposits
represented 87 percent of interest-bearing liabilities and other borrowings,
including Federal Home Loan Bank advances, which represented 13 percent of the
total.

Liquidity and Capital Resources

Net cash provided by operating activities totaled $2.6 million for the six
months ended June 30, 2002. Net cash used by investing activities totaling $3.9
million and consisted primarily of purchases of securities net of sales and
maturities of $976,000 and a $2.8 million increase in loans outstanding. The
increases in loans and purchase of securities were funded by existing cash on
the balance sheet. Net cash used by financing activities was $5.6 million
which was due to a decrease in total deposits of $9.1 million offset by net
offering proceeds of $4.8 million. The net decrease in cash and cash
equivalents for the year-to-date at June 30, 2002 was $6.8 million.

Total stockholders equity at June 30, 2002 was 10.42 percent of total
assets compared to 8.34 percent at December 31, 2001. The sharp increase in the
capital percentage is attributed to the Companys $4.8 million common stock
offering which closed in April 2002.

At June 30, 2002, WGNB Corp. was in compliance with various regulatory
capital requirements administered by federal and state banking agencies. The
following is a table representing WGNB Corp.s consolidated Tier-1, tangible
capital, and risk-based capital.

|                                         |  |        |        |   |  |        |       |          |  |               |        |   |  |        |      |   |  |   |        |  |  |  |      |  
|---------------------------------------- |  | ------ | ------ | - |  | ------ | ----- | -------- |  | ------------- | ------ | - |  | ------ | ---- | - |  | - | ------ |  |  |  | ---- | -
|                                         |  |        |        |   |  |        |       |          |  | June 30, 2002 |        |   |  |        |      |   |  |  
|                                        
|                                         |  | Actual |        |   |  |        |       | Required |  |               |        |   |  | Excess |      |   |  |  
|                                         |  | Amount |        | % |  | Amount |       | %        |  | Amount        |        | %
|                                         |  |        |        |   |  |        |       |          |  |               |        |  
|Total capital (to risk-weighted assets)  |  | $      | 38,393 |   |  |        | 14.77 | %        |  | $             | 20,797 |   |  |        | 8.00 | % |  | $ | 17,596 |  |  |  | 6.77 | %
|Tier 1 capital (to risk-weighted assets) |  |        | 35,209 |   |  |        | 13.54 | %        |  |               | 10,398 |   |  |        | 4.00 | % |  |   | 24,811 |  |  |  | 9.54 | %
|Tier 1 capital (to average
assets)       |  |        | 35,209 |   |  |        | 10.13 | %        |  |               | 13,893 |   |  |        | 4.00 | % |  |   | 21,316 |  |  |  | 7.05 | %

13



---



##### Table of Contents



Off Balance Sheet Risks

Through the operations of the Bank, the Company has made contractual
commitments to extend credit in the ordinary course of its business activities.
These commitments are legally binding agreements to lend money to the Banks
customers at predetermined interest rates for a specified period of time. At
June 30, 2002, the Bank had issued commitments to extend credit of $43,390,000
through various types of commercial lending arrangements and additional
commitments through standby letters of credit of $885,874. The Company
evaluates each customers credit worthiness on a case-by-case basis. The
amount of collateral obtained, if deemed necessary by the Company upon
extension of credit, is based on its credit evaluation of the borrower.
Collateral varies but may include accounts receivable, inventory, property,
plant and equipment, commercial and residential real estate. The Company
manages the credit risk on these commitments by subjecting them to normal
underwriting and risk management processes.




Item 3. Quantitative and Qualitative Disclosures About Market Risk

Market risk is the risk of loss from adverse changes in market prices and
interest rates. The Companys market risk arises primarily from interest rate
risk inherent in its lending and deposit-taking activities. The Company has
little or no risk related to trading accounts, commodities and foreign
exchanges.

Interest rate risk, which encompasses price risk, is the exposure of a
banking organizations financial condition and earnings ability to adverse
movements in interest rates. The measurement of market risk associated with
financial instruments is meaningful only when all related and offsetting on-
and off-balance sheet transactions are aggregated, and resulting net positions
are identified. Disclosures about the fair value of financial instruments as
of December 31, 2001, which reflected changes in market prices and rates, can
be found in the Companys Annual Report to Stockholders on Form 10-K for the
year ended December 31, 2001 under section entitled Managements Discussion
and Analysis of Financial Condition and Results of Operation  Asset/Liability
Management.

Management actively monitors and manages the Companys interest rate risk
exposure. The primary objective in managing interest rate risk is to limit,
within established guidelines, the adverse impact of changes in interest rates
on the Companys net interest income and capital, while adjusting the Companys
asset-liability structure to control interest rate risk. However, a sudden and
substantial increase in interest rates may not have proportional impact on
interest sensitive assets and liabilities. Management believes that there have
been no significant changes in the Companys market risk exposure since
December 31, 2001.

14



---



##### Table of Contents






Part II  Other Information




Item 1. Legal Proceedings

There are no material, pending legal proceedings to which the Company or
any of its subsidiaries is a party or of which any of their property is the
subject.




Item 2. Changes in Securities and Use of Proceeds

(a)  Not applicable.

(b)  Not applicable.

(c)  Not applicable.

(d)  On March 28, 2002, the Companys Registration Statement on Form S-1,
pursuant to which the Company registered 200,000 shares of its Common Stock for
sale to the public, was declared effective by the Securities and Exchange
Commission under Registration No. 333-84140. On April 10, 2002, the Company
commenced the public offering of these 200,000 shares, at a purchase price of
$24.00 per share, or an aggregate amount of $4,800,000. The offering was
conducted through the Companys officers and directors on a best-efforts basis
without compensation. The entire 200,000 shares subject to the registration
statement was sold, and the offering was terminated on April 23, 2002. As of
June 30, 2002, gross proceeds received from the offering totaled $4,800,000.
The Company received net proceeds from the offering of $4,765,654 after
deducting offering expenses of $34,346. The proceeds were invested in a
corporate bond with a book value of $646,586 as of June 30, 2002 and the
remainder is invested in federal funds.

During the second quarter of 2002, the Company declared and paid quarterly
cash dividends amounting to 14.75 cents per share. The declaration of
dividends is within the discretion of the Board of Directors and will depend,
among other things, upon business conditions, earnings, the financial condition
of the Bank and the Company, and regulatory requirements.




Item 3. Defaults Upon Senior Securities

Not applicable.




Item 4. Submission of Matters to a Vote of Security Holders

Not applicable.




Item 5. Other Information

None.




Item 6. Exhibits and Reports on Form 8-K



|(a) |  | The following documents are filed as part of this Report:
|--- |  | ---------------------------------------------------------



| | 3.1 |  | Amended and Restated Articles of Incorporation (Incorporated by
reference to Exhibit 3.1 to the Companys Registration Statement on
Form 10-SB filed June 14, 2000 (the Form 10-SB).
| | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | 3.2 |  | Amended and Restated Bylaws (Incorporated by reference to
Exhibit 3.2 to the Form 10-SB)                                                                                              
|
| | 4.1 |  | See exhibits 3.1 and 3.2 for provisions of Companys Articles
of Incorporation and Bylaws Defining the Rights of Shareholders                                                         
|
| | 4.2 |  | Specimen certificate representing shares of Common Stock
(Incorporated by reference to Exhibit 4.2 to the Form 10-SB)                                                                 





---



##### Table of Contents





| | 4.3    |  | Rights Agreement dated as of February 12, 1997 between the
Company and SunTrust Bank, Atlanta (Incorporated by reference to
Exhibit 4.3 to the Form 10-SB)
| | ------ |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | 10.1*  |  | Amendment to Employment Agreement dated May 30, 2002 between the
Company and L. Leighton Alston                                                           
|
| | 10.2*  |  | Amendment to Bonus and Stock Option Agreement dated June 17,
2002 between the Company and L. Leighton Alston                                              
|
| | 10.3*  |  | Incentive Stock Option Agreement dated March 12, 2002 between
the Company and L. Leighton Alston                                                          
|
| | 10.4*  |  | Amendment to Employment Agreement dated April 11, 2002 between the
Company and Richard A. Duncan                                                          
|
| | 10.5*  |  | Incentive Stock Option Agreement dated March 12, 2002 between the Company and Richard A. Duncan                                                           
|
| | 10.6*  |  | Amendment to Employment Agreement dated April 11, 2002 between the Company and H.B. Lipham, III                                                           
|
| | 10.7*  |  | Second Amendment to Bonus and Stock Option Agreement dated
June 17, 2002 between the Company and H.B. Lipham, III                                         
|
| | 10.8*  |  | Incentive Stock Option Agreement dated March 12, 2002 between
the Company and H.B. Lipham, III                                                            
|
| | 10.9*  |  | Amendment to Employment Agreement dated April 11, 2002 between the
Company and W. Galen Hobbs, Jr.                                                        
|
| | 10.10* |  | Amendment to Bonus and Stock Option Agreement dated May 30, 2002
between the Company and W. Galen Hobbs, Jr.                                              
|
| | 10.11* |  | Incentive Stock Option Agreement dated March 12, 2002 between the Company and W. Galen Hobbs, Jr.                                                         
|
| | 10.12* |  | Amendment to Employment Agreement dated April 11, 2002 between the Company and Steven J. Haack                                                            
|
| | 10.13* |  | Amendment to Bonus and Stock Option Agreement dated April 26, 2002
between the Company and Steven J. Haack                                                
|
| | 10.14* |  | Incentive Stock Option Agreement dated March 12, 2002 between the Company and Steven J. Haack                                                             
|
| | 99.1   |  | Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                        
|
| | 99.2   |  | Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes Oxley Act of 2002                                                        



---

|* |  | Indicates management contract or compensatory plan or arrangement.
|- |  | ------------------------------------------------------------------



|(b) |  | Reports on Form 8-K
|--- |  | -------------------



| |  |  | No reports on Form 8-K were filed during the quarter ended June 30, 2002.
| |  |  | -------------------------------------------------------------------------

16



---



##### Table of Contents






SIGNATURES

In accordance with the requirements of the Securities Exchange Act of
1934, the Company has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

|                      |  |            |  |                                                       | 
|--------------------- |  | ---------- |  | ----------------------------------------------------- | 
|Dated: August 8, 2002 |  |            |  |                                                      
|                      |  | WGNB CORP.
|                      |  |            |  |                                                      
|                      |  | By:        |  | /s/ L. Leighton Alston                               
|                      |  |            |  |                                                      
|                      |  |            |  | L. Leighton Alston
President and CEO                 
|                      |  |            |  |                                                      
|                      |  | By:        |  | /s/ Steven J. Haack                                  
|                      |  |            |  |                                                      
|                      |  |            |  | Steven J. Haack
Treasurer
Principal Financial Officer

17